COP30 may see inking of key $1.3tn deal to bridge climate financing gap
The proposals come as the financing gap for climate action reaches alarming levels
A coalition of finance ministers from 35 countries, including India, has unveiled a five-point strategy to mobilise $1.3 trillion annually for climate finance, ahead of crucial negotiations at COP30 in Belém next month.
The recommendations, released in Washington on October 15, call for scaling up concessional finance, reforming multilateral development banks (MDBs), boosting domestic capacity, mobilising private capital, and strengthening regulatory frameworks for climate finance.
The proposals come as the financing gap for climate action reaches alarming levels. According to the Independent High-Level Expert Group on Climate Finance, developing countries will need $2.4 trillion annually by 2030 and $3.3 trillion by 2035 to meet climate goals—a four to six-fold increase from current levels. Of this, $1.3 trillion per year must come from external sources by 2035.
The adaptation financing gap is particularly stark. While developing countries will face adaptation costs of $215-387 billion annually by 2030, current spending stands at just $68-80 billion. Nationally determined contributions (NDCs) from developing nations estimate their total needs at $5.1-6.8 trillion through 2030, or $455-584 billion annually.
The report, titled “Report of the COP30 Circle of Finance Ministers on the Baku to Belém Roadmap for 1.3T”, has been backed by finance ministers from Azerbaijan, Barbados, Brazil, Canada, Chile, China, Colombia, Denmark, Egypt, Ethiopia, Fiji, France, Germany, Ghana, India, Indonesia, Italy, Kenya, Mexico, Morocco, the Netherlands, the Philippines, Republic of Korea, the Republic of the Marshall Islands, Rwanda, Saudi Arabia, South Africa, Spain, Tanzania, Türkiye, the United Arab Emirates, Uganda, and the United Kingdom. It has not yet been backed by European Union and Australia in the Ministerial Statement of the COP30 Circle of Finance Ministers.
However, the document acknowledges it is non-negotiated and contains non-consensual views, with not all consulted countries supporting every recommendation.
The initiative builds on decisions made at COP29 in Baku last November, where nations agreed to mobilise at least $300 billion annually by 2035 for developing countries, with developed nations “taking the lead”. Developing countries criticised this target as “too little and too late”.
Current climate finance allocation remains misaligned with needs. In 2023, 43 per cent of concessional climate finance targeted mitigation, 34 per cent supported adaptation, and 23 per cent addressed both objectives—leaving adaptation and resilience-building significantly underfunded despite rising demands.
MDBs committed $75 billion to developing countries in 2023, with projections reaching $120 billion following COP29. They aim to mobilise an additional $65 billion annually from the private sector by 2030. However, the report emphasises that meeting global climate goals requires “significantly more ambition” and full implementation of the G20 Roadmap.
The ministers stress the importance of strengthening domestic climate frameworks through country-led initiatives, including voluntary country platforms, whilst enhancing climate data availability and risk assessment methodologies to support implementation of national adaptation plans.
The recommendations will serve as a key document for finance negotiations at COP30, scheduled for November 10-21 in Belém, Brazil.
